Business failures stabilise


The first five months of the year have offered some stability, according to the latest Business Failures figures from Equifax.

Q1 saw the number of companies failing drop by 5.9% year-on-year. However, they crept up by 1.5% year-on-year during May and April, serving as a reminder of the difficult trading conditions overall.

The regional picture saw London perform best in Q1, with failures down 12.7% year on year, although this wasn’t sustained through April/May, as failed businesses in the region rose by 5.2%.

In contrast, the south west is enjoying the best start to Q2, with failures down 11.4%.

Looking at performance across different sectors, manufacturing and services performed best in Q1, with failures down 14.8% and 10.9%, respectively. Manufacturing sustained this positive fall in failures, down 20.6% for April/May, providing a significant boost. The Construction sector continued to struggle with failures up slightly by 1.4% in Q1. And this increased further in April/May, up 9.4% year-on-year.

In contrast, the retail sector seems to be bucking the trend of the economic downturn. Although there was a small increase in failures, up 1.6% in Q1, for April/May there was quite a marked turnaround with a year-on-year drop of 12.5%.